WASHINGTON (Reuters) – AT&T will pay $ 60 million to resolve U.S. allegations it misled millions of smartphone customers by charging them for “unlimited” data plan that’s limited in data speeds if they used too much, as well as the Federal Trade Commission (FTC) said on Tuesday.
FILE PHOTO: the logo of The company, AT&T, which is shown on a display on the first floor of the New York Stock Exchange (NYSE) in New York city, USA-September 18, 2019 at the latest. REUTERS/Brendan McDermid
As part of the settlement of the 2014 complaint, ” AT&T is also forbidden to make any representation concerning the speed or the amount of mobile data, without providing any substantive restrictions on the data.
AT&T issued a brief statement acknowledging that it reached a settlement with the federal trade commission.
“Even though it’s been years since we applied this network management tool is in the way it was described by the FTC, we believe that it is in the best interest of the consumer,” AT&T said in a statement via e-mail.
The company has been fighting the FTC in court, saying that it had no jurisdiction to bring the case, but it was in the end of 2018.
The FTC alleged that AT&T would start to slow, “unlimited” customers ‘ data after they used as little as two gigabytes of data a month. Netflix says it’s looking for the show to be over 1 gb per hour of standard definition video.
Andrew Smith, director of the FTC’s Bureau of Consumer Protection, said AT&T promised not to keep it. “Although it is, of course, it is, to repeat, that the Internet service providers, people should be able to tell you about any restrictions or limitations on the rate or extent of the data, I promise,” he said in a statement.
The $60 million will be paid into a fund to make a partial refund for the current and ex-customers who had subscribed to the unlimited plan for 2011, but the data speeds will be reduced, or “throttled” by AT&T as their use was over a certain threshold.
FTC Commissioner, Rohit Chopra, said that he would push for major companies to be held responsible for the failure to comply with the agreements. “Crooks come in all shapes and sizes,” he said in a statement.
“None of these allegations were ever proven in court. We were fully prepared to defend ourselves, but it was decided that the settlement is in the best interest of the consumer,” said Jim Greer, a spokesman for AT&T.
Reporting by Diane Bartz and Lisa LambertEditing by Chizu Nomiyama, David Gregorio and Cynthia Osterman